Yesterday, June 30, we had another stage of parody in the negotiations between Greece and Eurozone. President Junker re-issued the same set of proposals, calling for PM Tsipras to react on that. The Greek side got back with a new, huge bailout plan, on the grounds that a specific growth plan will be discussed and agreed, with no further austerity cuts included.

Greece also demanded the exit of the IMF from the new bailout package, the full financing of the program by the ESM, and a series of pro-social and labour regulations: the reinstitution of the minimum wage, the reinstatement of collective agreements, the abolition of any fiscal measures imposed to lower wages and pensions.

It was more than obvious that such proposals could not be accepted by Eurozone. German Finance Minister Schäuble was already negative on any new proposal that would not include structural reforms, even if himself as well as other counterparts cannot define what structural reforms really mean. Despite being aware of that, PM Tsipras accepted the invitation of Junker to come back to the negotiations, but the extraordinary Eurogroup held last night did not bring something new. Nor today’s Eurogroup is expected to bring something new and all sides will be waiting the outcome of the referendum next Sunday.

The referendum In Greece two camps have been formed: The anti-austerity camp, supporting Syriza government, and the pro-European camp, supporting opposition parties (i.e. except for Golden Dawn). The immense paradox here is that both camps support exactly the same things and do not want a new bailout plan and further austerity measures. Both camps want a positive agreement for Greece, new economic perspectives for the economy and the society. Nonetheless, there is a big division, as people are not properly informed on the essence and the different proposals of the negotiations so far, being left completely puzzled on what the government wants and demands. Media in Greece have made a huge effort to distort the proposals and the strategy of the Greek government, whereas front opposition did its best to eliminate any prospect for dialogue.

The outcome of the referendum will define the next moves of the government. “Yes” would force PM Tsipras to call for early elections, whereas “No” would mean either a more determined relaunch of negotiations in a much worse position for Greece or the preparation -systemic ones mainly- for Grexit. Neither option is good for Greece.

What consequences after that?

It is clear that the Greek government has no intention to sign any agreement that will put national economy into deeper recession inside Eurozone. On its side, Eurozone did absolutely nothing to assist Greece in this shifting point, being obsessed with the left-wing government of Syriza. The Greek government did -and still do- its best to find a solution that could bring a growth perspective for Greece and would deal with the unbearable and chaotic sovereign debt. Creditors did not want to discuss about such crucial issues, putting negotiations into a huge limbo.

It is certain that Greece will suffer financially, politically and socially during the next weeks and months. Even years. And in a much harder way than the previous years, since the crisis sparked in late 2008. For the creditors, the problem is Syriza; For the Greeks is the fact that the economy has been trapped into such a deep-rooted uncertainty, between a sudden death and a mechanically-supported, slow death.

About: Dimitris Rapidis

Dimitris is thoroughly involved in the analysis of the Greek financial crisis in Eurozone, the political and geopolitical shifts globally, with emphasis in EU and MENA region. His analyses and interviews have been featured in national, European and regional broadcasting networks, media, and journals, such as Bloomberg, Euronews, Associated Press, Al Jazeera, El Pais, Publico, El Mundo, La Razon, Sputnik, Russia Today, Newsweek, Financier Worldwide, Die Welt, Handelsblatt, BBC, Nouvel Observateur, Anadolu Agency, Hurriyet, among others.

He has studied political science and international affairs at the Universities of Athens and Geneva. Dimitris is founding member of the Research Committee on Geopolitics (RC-41) of the International Political Science Association, and the Model of the European Union of the Galatasary University. He has been a guest speaker at numerous international academic and governmental conferences, summer schools and symposia in Europe.